Asia Pacific Data Centre Update

APAC EMERGING MARKET OVERVIEW

KEY INDICATORS*

17MW IN OPERATION

9 OPERATORS, 12 DATA CENTRES

20MW UC / PLANNED

36% VACANCY RATE

* Definition: Key indicators are based on operational Hyperscale Cloud, Colo, Edge & Telco data centre facilities in the market and excludes Captive & ICT.

Colo Hyperscale Cloud Telco

MARKET OVERVIEW

Vietnam may be a frontier data centre market at this juncture but has numerous fundamentals that would suggest great potential for development going forward. The country currently has 70% internet penetration, with an estimated 29 million people yet to get online. Over 48% of Vietnam’s capacity is located in the capital of Ho Chi Minh. Currently, only a small number of multinationals are locally requiring high-level capacity. The common approach for international operators is to partner with local telecommunication operators. There is a sizable lack of existing infrastructure relative to the population of the market and demand for internet services. This represents a major opportunity at both the content provision and infrastructure establishment level. South of Ho Chi Minh is preferred as a hub for data centres, especially for cloud services platform providers, due to latency issues and securing of manpower. Increasing land prices, limited land availability (especially for hyperscale) and limited current or future power supply in Ho Chi Minh directly are pushing new data centre developments to Binh Duong or Dong Nai provinces. Comparatively to other Southeast Asia markets, land is available at lower costs than most, and usually near manufacturing areas. Large sites are plentiful, with zoning appropriated for data centres a growing factor. Power is available in certain industrial parks, though difficult to come by. One challenge is the monopoly of the state-owned EVN on providing electricity. The cable landing stations (Quy Nhon, Danang & Vung Tau) were recently added in the past year and remain largely unexploited for rapid connectivity. There are a handful of undersea cables at three landing sites on the coast, with terrestrial fibre available in some areas. There is still only limited connectivity to the rest of the country, particularly in the remote, rural areas. Vietnam occasionally censors certain internet content, albeit not to the degree of some other regional governments. Data sovereignty regulations were just revised in 2021, with localization implications present. For foreign DC operators, it is worth nothing that DC service is a conditional business in the 2020 Law on Investment even though the detailed conditions to provide data centre service are still unknown.

ECOSYSTEM DEVELOPMENTS • AWS added edge nodes in Ho Chi Minh and Hanoi with Cloudfront , AWS Shield and other security services available. A formal Local Zone node is expected for deployment in Hanoi at some point on the horizon. • CMC Telecom opens its Tan Thuan Data Centre in August. The facility was designed by B-Barcelona of Singapore. The facility has a total area of 13,133 sqm and was 30% preleased at launch according to CMC. • Australian edge data centres firm, Edge Centres , have expanded into Asia with the deployment of their first data centre, EC51, in Vietnam in Ho Chi Minh in collaboration with the Vietnam National University. They also have plans for an additional edge site, HCMC District 1, in Ho Chi Minh. • GAW Capital acquired greenfield land in the Saigon Hi-Tech Park in Ho Chi Minh. The data centre is expected to be over 18,000 sqm and support 20MW in capacity. • NTT GDC and local Vietnamese firm Quang Dung Technology (QD.Tek) to develop a new data centre located in the Saigon Hi-Tech Park that will support 6MW of IT capacity, with an estimated launch date of 2024. • Viettel , a Vietnamese telecommunications company, announced plans to build a new data centre totalling US$260M in investment. While specifics on the facility have yet to be fully clear, this would be Viettel’s third project in Ho Chi Minh.